Eurozone support must not end, many Austrians think

Nearly one in two Austrians said their country should continue to participate in financial projects to stabilise ailing Eurozone members even if the European Union (EU) were to demand higher contributions.A study carried out by research firm Karmasin for weekly magazine profil shows that 49 per cent of Austrians think the federal government of Social Democrats (SPÖ) and the People’s Party (ÖVP) must not pull out from the 750-billion-Euro European Financial Stability Facility (EFSF) even if decision-makers rule that Austria must pay more. Forty-two per cent told Karmasin that the coalition should stop participating if that were to be the case. The SPÖ-ÖVP coalition agreed to contribute 12.24 billion Euros in liabilities.Josef Bucher, head of the Alliance for the Future of Austria (BZÖ), announced recently that his party planned to launch a referendum on whether Austria should stop participating. The opposition politician said: “We must stop bolstering countries which proved to be incompetent regarding keeping their finances in order.”Bucher added that the SPÖ and ÖVP should focus more on supporting Austrians affected by the credit crunch.Greece and Ireland are the only two Eurozone member countries which applied for support to avoid state bankruptcies. The term Eurozone describes the 17 EU member states which use the Euro as their currency.Rumour has it that the EFSF’s volume may be expanded shortly to ensure the federal economies of struggling states like Spain and Italy can be backed as well. The EU’s finance ministers have been engaged in a heated debate over whether such a decision would calm down the situation on international stock markets or simply worry potential investors even more.Austrian ÖVP Finance Minister Josef Pröll said he opposes calls to enlarge the EFSF “at the moment”. The ÖVP boss and vice chancellor added that it was more important to make the financial vehicle more efficient. SPÖ Chancellor Werner Faymann also made clear he rejected suggestions to increase the package’s volume.Portuguese Socialist Prime Minister Jose Socrates vehemently dismissed claims that his government is considering accepting support from fellow Eurozone member states. He told the Austrian Kurier newspaper: “We were one of the most successful countries in the EU in terms of getting federal finances in order in 2010.”Socrates vowed to continue the country’s strict cost-cutting procedure. Portugal’s political leaders recently agreed to increase the country’s value-added tax (VAT) by two per cent to 23 per cent.Former SPÖ Chancellor Franz Vranitzky meanwhile warned that “uninvited statements” over whether the Eurozone was in difficulties were not of any help.He said: “The situation is serious, but it will not get better if politicians constantly offer their point of view without being asked for it.”The ex-SPÖ boss said: “It has to stop that every five minutes someone somewhere in the EU predicts that something disastrous will happen to a member country. Not all of the people doing so have been invited to express their thoughts.”Austrian National Bank (OeNB) Governor Ewald Nowotny stressed there was no risk that the Eurozone could collapse. “Individual countries may be in difficulties, but not the Eurozone as a whole,” he said.Polls have shown that fewer than 30 per cent of Austrians want their country to reintroduce the Schilling considering the recent developments in the Eurozone. The currency was replaced by the Euro in 2002.The European Commission’s statistic agency Eurobarometer however also found that just 36 per cent of Austrians have a positive opinion about the EU as a whole at the moment. Austrian became a member of the EU in 1995 after around two thirds spoke out in favour of such a move in a referendum in the previous year.